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Ezra Reguerra
Nov 17, 2022


THE FTX CONTAGION: WHICH COMPANIES WERE AFFECTED BY THE FTX COLLAPSE?

The FTX saga has had a massive impact on the entire crypto industry, and some
companies bore the brunt of the crash.

7762 Total views
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7:12

News
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While the FTX collapse may have had a severe effect on the broader crypto
market, some companies bore the brunt of the impact and were directly hit by the
storm that the embattled crypto exchange brought. 

Here are some of the affected companies that Cointelegraph tracked up to Nov.
17, 2022.


GENESIS

Institutional trading firm Genesis announced on Nov. 11 that it had $175 million
in locked funds within the firm’s trading account on FTX. However, the company
noted that this does not have an impact on its market-making activities.
Furthermore, the trading firm clarified that this exposure is not material to
the business and won’t get in the way of its operations.



While the company had trading relationships with the crypto exchange, the firm
also clarified that it does not have an ongoing lending relationship with FTX or
Alameda Research.


GALAXY DIGITAL

Blockchain financial services company Galaxy Digital recently disclosed its
$76.8-million exposure to FTX. Within the amount, the firm highlighted that
$47.5 million is already in the process of being withdrawn. Despite the
exposure, the company highlighted that it still has $1.5 billion in liquidity.
This includes $1 billion worth of cash and $235.8 million in stablecoins, which
can cover its losses.


SEQUOIA CAPITAL

In a letter addressed to its limited partners, venture capital company Sequoia
Capital announced that its $213.5-million investment in companies FTX and FTX US
is now worth $0. The firm admitted that the FTX debacle spurred a solvency risk.
Despite this, the venture capital firm claimed that its exposure is limited and
offset by its gains. The firm wrote in a letter: 

> “The $150M loss is offset by ~$7.5B in realized and unrealized gains in the
> same fund, so the fund remains in good shape.”

The firm also highlighted that it is in the “business of taking risk,”
suggesting that some investments will have their upsides, while some will have
their downsides.


GALOIS CAPITAL

Hedge fund Galois Capital has admitted that part of its funds is stuck on FTX.
In a letter to investors obtained by the Financial Times, the firm reportedly
has half of its capital still stuck on FTX. The amount is estimated to be around
$100 million, based on the firm’s assets under management as of June.


BLOCKFI

As the FTX collapse hit the market, crypto lending firm BlockFi has also
admitted having “significant exposure to FTX and associated corporate entities.”
However, the firm denied rumors that the majority of its assets are held on the
FTX exchange. In an update, the firm wrote: 

> “While we will continue to work on recovering all obligations owed to BlockFi,
> we expect that the recovery of the obligations owed to us by FTX will be
> delayed as FTX works through the bankruptcy process.”

On Nov. 11, the company limited activities on its platform and halted client
withdrawals. The firm also advised clients not to deposit to its BlockFi wallets
or Interest Accounts.


CRYPTO .COM

Kris Marszalek, CEO of exchange Crypto.com, recently assured his customers that
the $1 billion worth of assets that the exchange moved to FTX was fully
recovered. The CEO highlighted that the exposure to the firm is only under $10
million. Marszalek also told users that the exchange will not be halting
withdrawals and denied allegations of using the exchange’s native token as
collateral for its loans.


WINTERMUTE

Crypto market maker Wintermute, the firm that made headlines after losing $160
million in a hack, has also admitted that it had some remaining funds on the FTX
exchange. It tweeted: 



While the company did not disclose the amount it held on FTX, the firm assured
its followers that the amount is within its risk tolerance and will not have a
huge impact on its financial position.


MULTICOIN CAPITAL

Venture capital firm Multicoin Capital reportedly has around $863 million in
assets frozen on FTX. In a letter reported by The Block, the firm highlighted
that it has 10% of assets under management within its Master Fund that’s stuck
on the exchange.


COINSHARES

Digital asset trading group CoinShares also disclosed its limited exposure to
the FTX exchange in an announcement posted on Twitter. The firm noted that it
was able to reduce its overall exposure to $31.5 million and assured its
community that the firm’s financial state remains strong. 



The exposure consists of around $3.1 million in Bitcoin

BTC

$16,639

Bitcoin

-0.27%

MARKET CAP

$319.66b

VOL. 24H

$468.31m

BTC $28.19k

, $1 million worth of Ether

ETH

$1,207

Ethereum

-0.49%

MARKET CAP

$147.75b

VOL. 24H

$262.81m

ETH $217.81k

, $25.9 million in United States dollars and USD Coin

USDC

$1.00

USD Coin

-0.01%

MARKET CAP

$44.39b

VOL. 24H

$24.28m

USDC $24.28m

, and $110,000 worth of other assets.


AMBER GROUP

Financial services firm Amber Group has announced that it has been an active
trading participant on the FTX exchange and has withdrawals yet to be processed.
Despite this, the company stated in an announcement that the exposure is only
limited to less than 10% of its total trading capital. The firm assured the
community that the amount does not threaten its liquidity or its operations.


PANTERA CAPITAL

In a blog post, investment firm Pantera Capital noted that it had suffered some
risks and losses from the FTX collapse. This came from the firm’s Blockfolio
acquisition, which was in FTX Token

FTT

$1.44

FTX Token

-5.77%

MARKET CAP

$444.20m

VOL. 24H

$960.65k

FTT $666.92k

and FTX stock. According to the announcement, the firm liquidated as much FTT as
it could on Nov. 8.


NEXO

While crypto lender Nexo admitted to having a small loan to Alameda Research,
the firm highlighted that the amount was less than 0.5% of its total assets. The
loan was fully collateralized by digital assets and was sold according to an
announcement. The firm was also able to dodge a potential $219-million loss by
withdrawing its entire balance from the FTX exchange.

Related: No red flags at FTX despite 8 months of ‘extensive due diligence’:
Temasek

Apart from the companies mentioned above, companies such as Nestcoin laid off
some of its staff because it was unable to withdraw its assets on FTX.
Meanwhile, decentralized finance firm Liquid Meta announced that it also held
around $7.5 million in FTX. Furthermore, Voyager Digital, which was set to be
acquired by FTX, announced the reopening of its bidding process. FTX’s
bankruptcy filing also estimates that it has more than 1 million creditors.

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 * #Business
 * #Venture Capital
 * #Bankruptcy
 * #Lending
 * #Hedge Fund
 * #FTX


Related News
 * What is Solana (SOL) Pay, and how does it work?
 * ad
   First omnichain smart contracts platform launches in full: Interview with
   ZetaChain
 * The fall of FTX and Sam Bankman-Fried might be good for crypto
 * Breaking down FTX’s bankruptcy: How it differs from other Chapter 11 cases
 * FTX names Kroll as claims agent, to update users on bankruptcy developments
 * Bahamian securities regulator ordered the transfer of FTX’s digital assets



Editor’s Choice
 * Spain for the win? Top 3 fan tokens to watch during the FIFA World Cup
 * SBF’s lawyers terminate FTX representation due to conflicts of interest
 * FTX leadership pressed for information by US subcommittee chairman
 * Grayscale cites security concerns for withholding on-chain proof of reserves
 * South Korea seizes $104M from Terra co-founder suspecting unfair profits

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